Blue Cross and Blue Shield of Rhode Island ousted Ronald Battista, president and chief executive officer, amid public outrage over reports of lavish executive perks, ballooning reserves, soaring premiums and skimpy reimbursements. Chief Operating Officer James Purcell was named acting president while the not-for-profit insurer conducts a national search for Battista's replacement. "While we deeply appreciate the extraordinary service Ron Battista has provided to this company, we have also come to understand that his continued service in this environment will distract us from our mission," said Frank Montanaro, the Blues' board chairman. Battista, 55, is credited with turning around the insurer, but recently the company has come under pressure to reform its practices. Earlier this week, board members made several concessions to legislators, including agreeing to forego their annual pay. Last month provider representatives publicly called for Battista's ouster.
Separately, Blue Cross and Blue Shield of North Carolina reported first-quarter net income of $52.8 million, a 14% decline from the year-ago period. The not-for-profit insurer has been working to reduce its profits after public criticism over its 2003 earnings, which jumped 129% to $196 million. As a result, its first-quarter profit margin shrank to 6.3%, down from 8.1% in the year-ago quarter. The company said it intends to keep its $797 million in reserves, although critics have demanded that some of the money be rebated to members. -- by Laura B. Benko